I have one of those cheap US General aluminum 3,000lb floor jacks. Over time, the working stroke had been slowly decreasing and I finally saw it leak a significant amount of oil. I filled it up through the fill hole until oil backed out of the bleeder screw (according to the label on the jack). To test the jack, I stood on the pad and worked the handle to produce lift. This works OK. However, when I go back up with the jack handle to have another stroke, the pad drops in proportion to the movement of the handle. Essentially what is happening is that on the down stroke I lift the pad and on the up stroke, the pad lowers.

With no weight, it works normally.

Has an internal seal failed in this jack and is it shagged?

Check valve is not holding. You should be able to take it apart and clean it. The handle pushes a piston that forces fluid into the jack body. When you raise the handle, a check valve (usually a ball check) holds the fluid in the body. Yours probably has a piece of trash in it holding it open.

Thanks. I guess I need to have a better look.